In a competitive labor market, it is a strategic imperative for employers to incorporate diversity, equity and inclusion (DEI) into talent and leadership strategies. This includes not only programs that support the diversity of talent preferences, but also what employees need to have equity in their careers, health and financial outcomes. Those employers who are not focused on equity run the risk of not attracting, retaining and engaging talent to move their businesses forward. But those that are able to use their pay, career and benefits strategies to demonstrably advance equity will have a distinct advantage as they compete for talent.
Despite the drive to progress DEI strategy, there is still much change needed to advance equitable outcomes. According to the 2022 Global Wealth Equity Index, women only accumulate 74% of the wealth of men at the end of their working careers, mostly due to gender pay gaps, delayed career trajectories, caregiving responsibilities and differences in financial literacy. Our 2022 Global Benefits Attitudes Survey also revealed that underrepresented employees, especially women and ethnic minorities, are less likely to report that they are paid fairly, experience psychological safety and have career advancement opportunities and support in the workplace.
For employers just getting started, or revising their DEI strategies, here are five actions to consider:
59% of organizations are boosting their DEI strategy today and 25% of organizations not currently boosting DEI strategy plan to do so in the future
(Source: WTW Salary Budget Planning Survey)
For example, after your last pay equity study, did you make meaningful changes to minimize future gaps? Also ask: Did we look for pay gaps related to bias? Do we have a career framework? Do our managers effectively cultivate talent? Do we have inclusive benefits, focused on high impact game changers (e.g., LGBT+)? Use the answers to these questions to prioritize strategies that have the most impact on underrepresented employees and support your equity strategy.
Ask critical questions such as, where have we achieved equity across employees, where are there gaps or opportunities and what is the business risk of not acting.
2 in 5 organizations report being effective at communicating pay and pay equity information to managers
3 out of 5 employers see career ecosystem as a priority
4 out of 5 organizations use managers to communicate pay to employees
See your path to DEI and equity
The ultimate goal is overall employee wellbeing, where all employees feel valued and experience belonging, have a sense of equity in their ability to grow their careers, are paid fairly, remain physically and emotionally healthy and have financial resiliency that enables them to build wealth for the future goals and security.
Accomplishing this requires a laser focus on understanding your workforce data and how your career, pay, benefits and other factors play a critical role in advancing equity and DEI strategy. How you prioritize strategies to close equity gaps depend on your company’s specific needs. There is no-one-size fits approach, but there are tools that can help you listen better to your employees and engage and empower your managers.
Authors
44% of S&P 500 companies consider DEI factors and metrics in executive incentive plans
(Source: WTW 2022 Report on ESG Metrics in Executive Incentive Plans).
